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The leaders of Britain's biotechnology industry have decided to get tough with companies that bring the industry into disrepute, issuing a draft code of practice for companies in the medical and life sciences sector.

The code is aimed at managing the flow of scientific information to shareholders in a way that does not adversely affect a company's share price, nor falsely raise expectations from patients' groups.

The nine-point code, released for public comment last week by the BioIndustry Association (BIA), is also aimed at helping bioscience companies to avoid the fate of the deeply troubled, but one-time flagship company, British Biotech.

The company was censured last month by the London Stock Exchange and the US Securities and Exchange Commission after an investigation concluded that it had issued misleading assessments on the status of its drugs trials (see Nature 392, 852; 1998).

While the code is not mandatory, all of the BIA's member companies listed on the Stock Exchange will be asked to provide information on the state of compliance in their annual reports. Companies will have to provide reasons for non-compliance. The identity of those who refuse to comply will be made public. Some could even be expelled.

The code has been enthusiastically received by many companies in Britain's 460-strong bioscience sector, as well as by the Stock Exchange and the Association of British Insurers, which represents the single largest shareholding community.

“The financial community expects company information to be full, frank and open. That's what the code hopes to achieve,” says BIA chief executive John Sime.

“Investors tell us they will take a dim view of companies who do not comply,” says Robert Mansfield, BIA's chairman. “In the life sciences, there has to be a partnership between management and shareholders. It is a long-term relationship based on trust.”

The code's provisions include: ensuring that the boards of companies have access to independent scientific advice, and expertise in handling scientific information; making sure that information to investors is as transparent and accurate as possible, and avoiding any temptation to oversell the implications of a result. The code also asks company scientists to exercise caution when discussing potentially price-sensitive information with peers.